Warren Enterprises Had the Following Events During Year 1: the Business

question 76

Multiple Choice

Warren Enterprises had the following events during Year 1: The business issued $40,000 of common stock to its stockholders.
The business purchased land for $24,000 cash.
Services were provided to customers for $32,000 cash.
Services were provided to customers for $10,000 on account.
The company borrowed $32,000 from the bank.
Operating expenses of $24,000 were incurred and paid in cash.
Salary expense of $1,600 was accrued.
A dividend of $8,000 was paid to the stockholders of Warren Enterprises.
Assuming the company began operations during Year 1, the amount of retained earnings as of December 31, Year 1 would be:

• A) $10,000
• B) $8,400
• C) $16,400
• D) $42,000

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Definitions:

Class Action

A lawsuit filed or defended by an individual or small group acting on behalf of a larger group.

Lengthy Resolution Process

A time-consuming procedure for resolving disputes or problems, often involving complex legal or negotiation steps.

Groundless Claim

A claim made in a legal or civil context that lacks any substantial evidence or justification, often considered to be made in bad faith.

Ethical Duty

A moral obligation that guides individual or corporate behavior in accordance with what is considered right and fair.